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EC Consults on Proportionate Regulatory Environment for SME Listing

ByRegulatory News

December 18, 2017

EC published consultation on building a proportionate regulatory environment to support small and medium enterprise (SME) listing. The consultation intends to identify the areas in which the administrative burden on listed SMEs can be lightened and areas in which targeted regulatory changes could help (re)build the local ecosystems surrounding SME-dedicated exchanges. The consultation is open till February 26, 2018.

SME financing through public markets has not fully recovered since the financial crisis, although listing on stock exchanges can give a significant boost to this type of businesses. This includes the listing of shares and bonds on SME Growth Markets, which is a new category of trading venues dedicated to small issuers. Facilitating access to finance for SMEs through all their development stages is a key element of the Capital Markets Union initiative of EC. The Capital Markets Union Mid-term Review published in June 2017 raised the project's level of ambition and strengthened its focus on capital-raising by SMEs on public markets. EC committed to assessing whether targeted amendments to EU rules could deliver a more conducive regulatory environment to support SME initial public offerings. The consultation will help the EC identify ways to cut red tape and build a supportive environment for SMEs wanting to list their shares or bonds on SME Growth Markets, without jeopardizing investor protection and market integrity.

European Parliament published a report that provides a concise overview of the Dodd-Frank Act, the challenges of its implementation, and efforts to roll back the Act, in large part due to what are viewed to be vague and impractical provisions.